Microsoft: Portable games consoles not viable

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Microsoft has said once again that it will not be perusing a dedicated handheld device in the same way Nintendo and Sony are.

“In a term of a dedicated handheld there are questions of the viability of that business model,” Dennis Durkin, Microsoft’s chief operating and financial officer of the company’s Interactive Entertainment Business told Pocket-lint at a roundtable at E3 in Los Angeles.

“People have been asking for a long time about handhelds. It’s a really interesting time in that market. Look at the Nintendo 3DS, it’s been a slower start than analysts and others had expected, but it’s a super-competitive space. Any dedicated portable device like a camera, or a portable gaming device like the 3DS has a tough time.”

“They are very challenging markets as phones have got smarter, and we’ve chosen to make our bed around the phone instead and add Xbox Live services to Windows Phone 7 instead,” the exec insisted.

Microsoft hasn’t hidden the fact that it believes in it’s portable gaming experience should be experienced by phone users rather than those on a dedicated console, but it’s the first time the company as actively said that it doesn't see a dedicated version as viable.

“Today on Windows Phone, Xbox Live games make up less than 1 per cent of the number of games that are on there. They are over 30 per cent of the units of the games downloaded on the phone, and they over 70 per cent of the revenue. That’s because consumers value the experience and integration of the game with Xbox Live.” added Marc Whitten, corporate vice president of Xbox LIVE.

With such high adoption and revenue returns Microsoft is no doubt happy with the performance of such games. Add that to a previous demo shown by Microsoft in February that it’s Windows Phone 7 smartphone will be able to talk to it’s Kinect sensor and the Xbox 360 allowing phone users to directly interact with games on screen and the combination is already doing what the Wii U controller is professing will be possible next year.